November 08, 2024
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Supreme Court: Shipyard is in Maine

KITTERY – The U.S. Supreme Court on Tuesday put to rest the debate over which state owns the Portsmouth Naval Shipyard, ruling that the 201-year-old shipyard is in Maine, not New Hampshire.

Eight members of the court unanimously brushed aside New Hampshire’s claim to the shipyard, which is on 297-acre Seavey Island in the Piscataqua River that divides the two New England neighbors.

Maine long has claimed the border was the middle of the Piscataqua River, putting the shipyard squarely in Maine. New Hampshire contended the border was the Maine shoreline of the river, putting it in New Hampshire.

The court relied on a 1977 Supreme Court consent decree that settled a lobster-fishing dispute between the two states.

“New Hampshire’s claim that the Piscataqua River boundary runs along the Maine shore is clearly inconsistent with its interpretation of the words ‘middle of the river’ during the 1970s litigation,” Justice Ruth Bader Ginsberg wrote for the court.

There were two interpretations of the precise meaning of “middle of the river” then, Ginsberg said. But, she said, “both constructions located the ‘middle of the river’ somewhere other than the Maine shore.”

The court said a legal doctrine called judicial estoppel prevents a party from winning one case based on one interpretation of the facts and using a different interpretation of the facts in a later case.

Ginsberg rejected New Hampshire’s claim that it had not done enough historical research in the earlier case.

Justice David Souter did not participate in the decision. Souter was New Hampshire’s attorney general in the mid-1970s and endorsed the 1977 settlement.

Maine officials were pleased.

“We believe the case is closed,” Attorney General Steven Rowe said from Augusta. “We’re pleased that the court agreed with our view that we have already ‘Been there, done that.”‘

At stake was $4 million to $6 million a year in income taxes that Maine collects from roughly 1,300 New Hampshire residents who work at the yard. New Hampshire has no personal income tax.

New Hampshire officials generally panned the decision.

“There is abundant historical evidence that Portsmouth Harbor and its islands, including the islands that are now home to the Portsmouth Naval Shipyard, are part of New Hampshire,” said New Hampshire Gov. Jeanne Shaheen.

Similarly, New Hampshire Attorney General Philip McLaughlin said the 1977 agreement dealt with the boundary from the mouth of Portsmouth Harbor seaward, not inland.

Sen. Olympia Snowe, R-Maine, said the ruling marked the third time the border had been decided. The other times were in 1977 by the Supreme Court and in 1740 by King George II.

“Three strikes and you’re out,” said Snowe, who urged both states to let the matter rest. “Maine and New Hampshire should not approach the bench on this matter again,” she said.

Workers emerged from the shipyard Tuesday afternoon to learn of the decision.

Dana Hodgdon of Somersworth, N.H., expressed frustration over paying income taxes to Maine.

“It’s an awful expense for no return. It’s a couple thousand dollars a year for nothing,” said Hodgdon, who is a shipfitter supervisor. “What does the state of Maine give me?”

Though the border is settled, New Hampshire officials suggested they will keep fighting on the tax issue.

“There’s no question that New Hampshire workers at a federal facility shouldn’t be assessed Maine income tax,” said Rep. John Sununu, R-N.H.

Maine’s income tax is especially galling for married workers from New Hampshire. They pay higher Maine income taxes if their spouses work, even if the spouse does not work in Maine. That’s because Maine’s graduated income tax is based on family income, not individual income.

“Let me put it this way: We’re being robbed,” said Victor McLean, a shipfitter from Newington, N.H. “The wife gets nailed. And it’s legal.”

Sen. Judd Gregg, R-N.H., said that “while it is extremely unfortunate they will continue to do so [pay Maine income taxes], it should not cause us to lessen our efforts on behalf of the larger issue: to ensure the vitality of the shipyard as an integral part of our national defense structure.”

Sen. Bob Smith, R-N.H., suggested that “Maine should recognize on its own that there would be no Portsmouth Naval Shipyard if it had not been for the thousands of New Hampshire citizens who have worked at the yard for the past 200 years.

“Maine should stop [its] unfair taxation of our workers who contribute so much to the shipyard.”

Smith has introduced legislation in the Senate to prohibit states from taxing nonresidents who work there, as Maine, Massachusetts and Vermont do to New Hampshire workers.


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